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Online Wins Big In Thanksgiving Stakes

Shoppers came out in force over the
Thanksgiving shopping period, but didn’t necessarily
leave their homes.

Surveys suggested that free-shipping offers, comparable
pricing and the lure of home shopping ate into
brick-and-mortar business, culminating in a record $1
billion in total online sales on Cyber Monday.

A report by the National Retail Federation (NRF)
pegged total retail sales from Nov. 25-27 at $45 billion,
with the average shopper shelling out $365.34
in stores and online, an increase of 6.4 percent over
last year.

Traffic was also up as some 212 million shoppers
visited stores and websites over the weekend, representing
an 8.7 percent increase year over year, the
NRF said.

But absent the contribution from e-tail, brick-andmortar
sales were less than stellar. According to
ShopperTrak, store-based sales were essentially flat
on Black Friday, up a negligible 0.3 percent to $10.7
billion across all retail locations. The research firm
believes business was impacted by early November
promotions, which boosted sales and traffic 6 percent
during the first two weeks of the month, and by compelling
online offers.

“A percentage of retailers concentrated on pushing
folks to their websites with various online-only sales,
which most likely influenced Black Friday performance,”
said ShopperTrak founder Bill Martin.

Indeed, the number of people who shopped online

Thanksgiving weekend rose a healthy 15.2 percent
to 33.6 percent of all shoppers, NRF said, while market
research firm ComScore reported a 9 percent increase
in online spending on Black Friday, to $886 million, and
the billion-dollar bonanza on Cyber Monday.

Even Thanksgiving Day, traditionally a lighter spending
window, saw online sales soar 28 percent to $407
million, ComScore said, while a survey by the Consumer
Electronics Association (CEA) showed that
more than half (53 percent) of consumers who bought
electronics on Thanksgiving purchased them online,
due to deals that were the same or better than those
offered by retail stores.

“Although Black Friday is known for the flurry of activity
occurring in brick-and-mortar retail stores, online
shopping is increasingly becoming the refuge of those
preferring to avoid the crowds and long lines,” noted
ComScore chairman Gian Fulgoni.

Steve Baker, industry analysis VP for The NPD
Group, said traditional retail tactics like extended holiday-
sale periods helped the online channel grow its
share of Black Friday shoppers by 44 percent, compared
to a 6 percent increase for brick-and-mortar
stores. “The trend is clear — attaching retail brick-andmortar
shopping patterns to online patterns are proving to be successful, and vice versa as
well,” he wrote in an NPD blog.

Online sales hit their peak on Cyber
Monday, soaring 19.4 percent yearover-
year and outpacing Black Friday’s
16 percent spike by 31 percent, according
to a report by IBM Coremetrics.
The average Cyber Monday order
was $194.89, up 8.3 percent from last
year, and 2.1 percent higher than the
average haul on Black Friday, making
it the biggest shopping day of the year,
the company said.

cited Cyber Monday as its single-best
sales day in company history, with sales
up 48 percent year-over-year as of 5:00
p.m. PST on Nov. 29. The e-tailer also
enjoyed its best Black Friday ever with
net sales up 45 percent, driven by a
better than 100 percent increase in purchases
through third-party sellers.

Online also led the charge for multichannel
retailer ShopNBC. Total company
sales rose 36 percent on Cyber
Monday while online sales surged 59
percent to comprise 56 percent of net
revenue, up from 48 percent last year.

Similarly, ShopNBC’s total Black
Friday sales rose 12 percent over last
year, driven by a 54 percent increase in
online sales. E-commerce comprised
51 percent of net sales that day, up
from 37 percent last year and 40.5 percent
during the third quarter.

AT&T similarly saw record online traffic
on Black Friday and Cyber Monday,
which contributed to one of the busiest
post-Thanksgiving shopping weekends
in company history.

was up 14 percent
on Black Friday and more than 22
percent on Cyber Monday, driven by
“compelling deals” and shop-at-home
convenience. Traffic was also up significantly
in the carrier’s brick-and-mortar
stores, drawn by device upgrades and
U-verse TV sales, the company said.

“More consumers want the convenience
of shopping online -- this has
been a trend building over the last several
years and [was] why we offered
such a robust line-up of deals to kick
off the holiday season,” said

John Squire, chief strategy officer for
IBM Coremetrics, concurred. “Consumers
appear much more willing to
open their wallets and are turning to
online stores for the convenience of
shopping wherever and whenever they
like, but also as their primary source of
information about products and inventory
levels,” he said.

According to a survey by Shop.org,
the online arm of NRF that actually
coined the term Cyber Monday, nearly
nine out of 10 retailers (88.2 percent)
planned special promotions for that
day, up from 72.2 percent in 2007.
Plans included specific deals (49 percent,
up from 43 percent last year),
one-day sales (41 percent vs. 33 percent
last year), and free shipping on all
purchases (21.6 percent vs. 15.7 percent
last year).

, discounts were offered
on over 150 select items during
a “Cyber Week” sale that ran through
Dec. 3. Featured products included
a Philips 8GB Vibe MP3 video player
for $40, Garmin’s Nuvi 295W 3.5-inch portable GPS for $89, a 24-inch Viore
LED-TV for $199, and an Hewlett-Packard
Mini 210 netbook PC for $318, all
with free shipping.

E-tailers also leveraged social networking
sites and mobile shopping
apps to provide information about
deals and inventory levels. While the
percentage of visitors arriving from
social networking sites is fairly small
(nearly 1 percent), the strategy is gaining
momentum, Coremetrics said, with
Facebook leading the category.

What’s more, 3.9 percent of Cyber
Monday shoppers visited a retailer’s
site using a mobile device, the research
firm said. Shop.org put the figure even
higher at 6.9 percent, nearly double the
estimated 4 million who shopped that
way last year.

Taken together, the inducements led
an estimated 106.9 million Americans
to shop on Cyber Monday, Shop.org
projected, up from 96.5 million last
year. Interim executive director Joan
Broughton said the trade group was
actually surprised that the catchphrase
caught on in such a big way over the
past five years. “Today, Cyber Monday
has become such a crucial component
of the holiday season that many retailers
— and shoppers — don’t remember
the holidays without it,” she said.

Bernard Luthi, marketing, web and
customer service VP at e-tail-only merchant
Newegg.com, concurred. “Cyber
Monday is a viable, viable day,” he told
TWICE, “one of the top two or three
days of the year.”

NPD’s Baker regards the increase in
online volume as incremental business,
rather than siphoning sales from retail
stores. “Consumer sales overall and
even tech sales specifically, are likely to
see an increased splintering of the consumers’
wallet as they become more
multi-channel shoppers,” he observed.

But regardless of how and where
people shop, most weekend watchers
agreed that solid Thanksgiving volume
may portend a good holiday season for
all retailers.

“The holiday shopping season got off
to a strong start this weekend, as consumers,
on average, completed nearly
twenty percent of their holiday shopping,
highlighting the importance of the
Thanksgiving Day weekend for retailers,
manufacturers and consumers,”
said Shawn DuBravac, CEA’s chief
economist and director of research.

Added NRF president/CEO Matthew
Shay, “While Black Friday weekend is
not always an indicator of holiday season
performance, retailers should be
encouraged that a focus on value and
discretionary gifts has shoppers in the
spirit to spend.”

Looking ahead, Shay advised retailers
to keep the momentum going
through the early weeks of December
with “savings and incentives that holiday
shoppers simply can’t pass up.”